When you are considering or comparing various pre-construction projects to acquire a unit i— either as an investor or end user — doing your homework and researching is crucial.
So where do you begin?
While the location of the site, how far the amenities away are, and aesthetics of the area will help to determine the price, as well as play a role in your decision process. You should start doing your research about the developer.
You should take the necessary time to find out all you can about the developer that will be building your potential future home. Try to learn as much as you about their successes, experience and reputation.
After educating yourself on their past experiences, it should be worth digging a little deeper into how the developer will facilitate your purchase, this of course is your pre-construction project. Here are some helpful tips when it comes to buying pre-construction:
- Avoid buying close to the end of a developer’s marketing campaign, as you will most likely be paying an inflated price for the unit.
- Examine what type of finishes the developer offers, especially when it comes to appliance for the house and the brands that are offered, as well as bathroom materials, kitchen cabinetry and fixtures.
- Ask their on-site sales team about how many price increases have gone into effect since the opening of sales for units. Once certain percentages of sales have been reached in different lines in their inventory, developers will often raise the price.
- You can also ask about any clauses in the purchase agreement that may restrict you from listing your unit for rent or sale with a broker, advertising it and/or putting it on MLS prior to closing.
- Don’t forget to ask about developer fees! It is standard practice for developers to charge one at closing. A reputable developer will be willing to cap them before you sign on the dotted line.